After the publication of the first quarter GDP numbers, Reserve Bank of India Governor Shaktikanta Das has once again reiterated that India’s economy continues to grow well. Speaking at the CA National Conference in Bhubaneswar, Odisha, Das allayed concerns over the recent fall in GDP numbers, saying that the same was due to reduced government spending during the election period and also slower growth in the agricultural sector. But all other major sectors have grown by more than 7 per cent, he added.
Das said, “I want to say with all humility, sincerity and confidence that India’s growth story is intact.” The slowdown in growth was largely due to contraction in government spending, which was likely affected by the election season, he explained.
India’s economy expanded 6.7 per cent in real terms during the April-June period of the current fiscal year 2024-25, according to data released by the Ministry of Statistics and Programme Implementation. This is a slowdown compared to the previous four quarters when the economy was growing consistently above 7 per cent.
However, the Governor was confident that with increased government spending in the second and third quarters, the growth projection for the Reserve Bank of India In this fiscal year, growth of 7.2 percent is expected. He pointed to the overall growth in many sectors and referred to the increase in private consumption, which in the first quarter was 4 percent, up to 7.4 percent, while the growth was recorded in the investment sectors, with 7.5 percent, industries, with 7.4 percent, manufacturing, with 7 percent, and services, with 7.7 percent. The construction sector grew by 10.5 percent.
Das also noted that the agricultural sector, which grew 2 percent in the first quarter, could improve its performance due to a favourable monsoon season. “Because the monsoon has been very good this year, it has actually covered large parts of the country, except for some areas in eastern India,” he said.
Das further highlighted India’s progress in innovation transformation, especially in the adoption of financial technology and the growth of startups.
(With contributions from the agency)
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